In his keynote, Schulman highlighted Gustav Reyes, the owner of Chicago-based Simply Wood Rings, which makes eco-friendly wooden wedding rings. Like the majority of PayPal's customers, Reyes does most of his sales through his website. Simply Wood Rings generates up to $500,000 in annual revenue. Reyes has utilized a $8,500 loan to cover the cost of updating his website: "They allowed us to take payments and then, at the point where we are big enough to need a loan, they are there," said Reyes. "Having that opportunity opens up a new world in terms of business for me."
Working Capital is only available to existing PayPal merchants who have been processing payments via PayPal for at least 90 days and have processed at least $20,000 in the past 12 months. The company is able to speed up the application process — to as little as a few minutes — because it leverages insights based on the relationship it has with merchants to assess creditworthiness. Most of PayPal's customers using Working Capital have been with PayPal for multiple years, so the company has an extensive set of proprietary data to leverage.
Merchants can borrow up to $85,000, or up to 15 percent of sales processed over the PayPal network over the past year. PayPal charges a single fixed fee that varies depending on how fast the merchant plans to repay the loan. If approved, the money is deposited into the merchant's account instantly. Loans are then repaid as a percentage of sales with merchants choosing to pay off 10 to 30 percent.